Since purchasing power has increased significantly and inflation has dropped to a record low, economists predict that the GST 2.0 reforms will set new Diwali shopping records for the nation.

People now have more money thanks to the GST cut, and inflation naturally declines as purchasing power rises.

Key Highlights

• GST 2.0 simplifies tax slabs and cuts rates, making many goods cheaper ahead of Diwali.
• Retailers and consumers are expecting record festive sales, especially in electronics, vehicles, and apparel segments.

The lower and middle classes have been most affected by the decrease in retail prices. Harvansh Chawla, Chairman of the BRICS Chamber of Commerce and Industry, told IANS that people who could previously purchase a single item, say, for Rs100, can now purchase several items.

This is going to be a "historic Diwali," he said. "Traders will greatly benefit from the unprecedented sales that will occur this Diwali."

Economist Dr. Manoranjan Sharma claims that as food and fuel prices decreased during the month, India's Consumer Price Index (CPI)-based inflation rate fell to a record low of 1.54 percent in September of this year, down more than eight years from the same month the year before.

In addition, India's Wholesale Price Index (WPI)-based annual inflation rate decreased from 0.52% in August to 0.13% in September. Due to recent rate cuts, September GST collections also reached Rs 1.89 lakh crore, indicating a 9.1% YoY growth.

"Millions of people have benefited from the increased disposable income that the average person has today," Dr. Sharma told IANS.

Because of the GST reductions, you might witness a higher spike in shopping this Diwali. Because more people can now shop, the festive atmosphere will be more pleasant than before, and traders will eventually profit as well," he continued.

Also Read: GST 2.0 Kicks In Today with Key Reforms to Ease Prices

In the end, GST reforms have reduced costs for both producers and consumers by lowering prices, improving credit flow, resolving tax inversion issues, and reducing disputes.